Movie studio Metro-Goldwyn-Mayer, home of movie franchises such as James Bond and The Pink Panther, proposed a bankruptcy plan that would reduce its debt by $4 billion and put the founders of Spyglass Entertainment in charge of the legendary studio.

MGM said it is seeking lenders' votes for the plan, which would involve secured lenders exchanging more than $4 billion in debt for 95.3% of equity in the company once it emerges from Chapter 11, Reuters reported.

The restructuring would clear the way for the making of "The Hobbit," a two-part prequel to the blockbuster "Lord of the Rings" trilogy.

The studio has struggled with debt after a $2.85 billion buyout in 2005. The group leading the buyout included media company Sony Corp. (SNE) and private equity company Providence Equity Partners.

The company's secured lenders have until Oct. 22 to vote on the plan.

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